Guest Column
| September 8, 2011

Leaking Money - Revenue Loss From RAC

RAC audits threaten to reclaim Medicare and Medicaid payments already collected by your healthcare facility. This article outlines ways you can ensure you retain this revenue.

Think back to your childhood. Remember the joy of going to buy something with the allowance money you had saved after weeks of performing chores. Now recall how you would have felt if you made it to the checkout line, only to realize the money you thought you had in your pocket was lost.

That’s how hospitals all across the country are feeling as they undergo RAC audits, an initiative by the Centers for Medicare & Medicaid Services (CMS) to reclaim overpayments to healthcare providers. These audits are performed by four Recovery Audit Contractors (RAC), and their efforts have already recouped millions from hospitals. These contractors are paid on a commission basis, so there is a strong incentive to uncover as many overpayments at your hospital as possible.

The Pain Of The RAC Process
Therefore, large sums of money your hospital has collected may be in danger of being reclaimed by the RACs. If the loss of revenue wasn’t enough, the time and energy your staff must devote to comply with the auditors is prohibitive.

RACs have the ability to go as far back in your claims as October of 2007. Even hospitals with some level of automation find these audits painful, since their EMR systems typically weren’t implemented that far back.

Plus RAC chart requests can exceed 400 per 45 day cycle. This presents an enormous challenge for staff trying to control the multitude of paper charts floating from department to department. Hospitals have been doing the best they can to comply with RACs, but they have found the tools they’ve been using to be less than adequate. Access This Content To Read This Article In Its Entirety.